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If you are anxious to get your investments started, you can get
started right away without having a lot of knowledge about the
stock market. Start by being a conservative investor with a low
risk tolerance. This will give you a way to making your money grow
while you learn more about investing.
Start with an interest bearing savings account. You may already
have one. If you don’t, you should. A savings account can be
opened at the same bank that you do your checking at – or at any
other bank. A savings account should pay 2 – 4% on the money that
you have in the account.
It’s not a lot of money – unless you have a million dollars in
that account – but it is a start, and it is money making money.
Next, invest in money market funds. This can often be done through
your bank. These funds have higher interest payouts than typical
savings accounts, but they work much the same way. These are short
term investments, so your money won’t be tied up for a long period
of time – but again, it is money making money.
Certificates of Deposit are also sound investments with no risk.
The interest rates on CD’s are typically higher than those of
savings accounts or Money Market Funds.
You can select the duration of your investment, and interest is
paid regularly until the CD reaches maturity. CD’s can be
purchased at your bank, and your bank will insure them against
loss. When the CD reaches maturity, you receive your original
investment, plus the interest that the CD has earned.
If you are just starting out, one or all of these three types of
investments is the best starting point. Again, this will allow
your money to start making money for you while you learn more
about investing in other places.
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